Hong Kong to See Flurry of Year-End IPOs
U.S. handbag maker Coach Inc. and China’s third-largest insurer were among several companies that received approval to list on the Hong Kong stock exchange, paving the way for a flurry of year-end IPOs even as volatility continues to hurt investor appetite for new shares. Hong Kong’s stock market is down almost 8% in the past three months, and only one of the major deals is taking orders: the up to $1.4 billion IPO by PCCW Ltd’s telecom trust. PCCW Chairman Richard Li is buying up to a 12.66% stake that deal, a person familiar with the situation said Friday. Meanwhile, the Nasdaq-listed Melco Crown Entertainment Ltd., which plans to list in Hong Kong by the end of the year, said it won’t raise funds in its listing due to market volatility.
The Hong Kong stock exchange’s listing committee Thursday gave New China Life, China’s third-largest insurer by premiums, the go-ahead to list in the city—just days after it got approval from Chinese regulators to also list in Shanghai, people familiar with the situation said Friday. They said New China Life, which plans to raise around $3 billion from the dual listing in mid-December, will start gauging investors’ interest, known as the premarketing stage in the IPO process, on Monday, and start taking orders Nov. 29. Coach plans to list in Hong Kong on Dec. 1 through the issue Hong Kong depositary receipts, a person familiar with the situation said Friday, as the U.S. handbag maker looks to raise its profile among China’s growing ranks of wealthy consumers. Coach follows the lead of other high-end brands such as Italian fashion house Prada SpA, and U.S. luggage maker Samsonite International SA in seeking Hong Kong listings. The U.S. bag-maker’s issue of depositary receipts won’t involve any fund-raising.
Shanghai Baoxin Auto Sales & Service Co., a BMW dealer in China, got approval Thursday from the listing committee for an around $800 million IPO, a person familiar with the situation said. The company will start testing investor appetite for the deal Monday, followed by order-taking Nov. 28, and plans to list mid-December, the person said. Tianrui Group Cement Co., in which U.S. private-equity firm Kohlberg Kravis Roberts & Co. has a minority stake, also got approval for its $500 million IPO. KKR invested $115 million in the company, based in China’s Henan province, in 2007.